Question

Cost-push inflation:
A. reduces real output.
B. increases real output.
C. reduces the unemployment rate.
D. raises the natural rate of unemployment.

Which of the following is the largest dollar amount in the United States?
A. disposable income
B. personal income
C. gross domestic product
D. national income

Real GDP is:
A. the nominal value of all goods and services produced in the economy.
B. the nominal value of all goods and services produced in the domestic economy corrected for inflation or deflation.
C. that aggregate output that is produced when the economy is operating at full employment.
D. always greater than nominal GDP.

Answer 1

Answer-1. Correct option is 'a'

Cost-push inflation reduces real output. Cost push inflation is inflation caused by an increase in price of inputs like labour , raw material etc. The increased price of factor of production lead to a decreased supply to these goods and as a result the real output will fall.

Answer-2. Correct option is 'c'

Gross Domestic Product is the largest dollar amount in the United States. GDP is the total market value of all finished goodsand sevices produced within a country in a set of period of time. In the U.S ,the largest and most stable component of consumption is services. Consumption is calculated by durable and non-durable goods and sevices expenditure.

Answer-3. Correct option is 'a'

Real GDP is the nominal value of all goods and services produced in the economy. Real gross domestic product (GDP) is an inflation-adjusted measure that reflects the value of all goods and services produced by an economy in a given year (expressed in base-year prices).